Northrim Bank launched the Alaskanomics blog to provide news, analysis and commentary on Alaska’s economy. With contributions from economists, business leaders, policy makers and everyday Alaskans, Alaskanomics aims to engage readers in an ongoing conversation about our economy, now and in the future.

Northrim Bank launched the Alaskanomics blog to provide news, analysis and commentary on Alaska’s economy. With contributions from economists, business leaders, policy makers and everyday Alaskans, Alaskanomics aims to engage readers in an ongoing conversation about our economy, now and in the future.

December 2018

Monday, December 24, 2018

November employment was down 0.4 percent from 2017. That equals roughly 1,300 jobs. Retail had the largest loss of jobs with over half at 700. Professional and business services and manufacturing each lost 500 jobs. Health care continues to add jobs with an additional 500 jobs over last year. Transportation, warehousing, and utilities and construction both had gains with 300 and 200 respectively.

Alaska’s seasonally adjusted unemployment was 6.3 percent in November. This is down one-tenth of a percent from October. This is still well above the national average, which was 3.7 percent in October.

Not-seasonally adjusted rates were higher in nearly every borough and census area, which is normal this time of year. Denali and Skagway rates doubled between October and November, which is common due to their reliance on tourism. Some areas had rates below the state’s average. Aleutians East Borough and Aleutians West Census area were still low with 5.1 and 4.5, respectively. Even though fishing is dying down for the season, these areas still had low rates on average. Sitka, Juneau and Anchorage all had rates well below the state’s average with 4.0, 4.6, and 5.1 percent respectively.

Thursday, December 13, 2018

We focus on the last two years of the recession where we present an exercise by region to showcase which boroughs/census areas have fared well and which ones continue to experience difficulties. We divide Alaska into five regions: Southeast, Southwest, Southcentral, Interior, and the Far North. For each region we show a two way graph of employment percent changes between 2016-2017 and those of 2017-2018. This permits us to see how boroughs/census areas have performed in both years at the same time.

The boroughs/census areas which grew in both 2017 and 2018 will be in the upper right quadrant, the ones which experienced negative growth in both years will be in the lower left quadrant, the ones which experienced growth in 2017 and decline in 2018 will be in the upper left quadrant, and the ones who have experienced declines in 2017 but growth in 2018 will be in the lower right quadrant.

Southeast Alaska

The figure below shows that Skagway, Haines, Sitka, Prince of Wales all experienced positive growth in both 2017 and 2018. Petersburg census area and Juneau are the only two units to have experienced negative growth in both 2017 and 2018. It is, however, the case that Juneau’s employment declines were much more modest than those experienced in Petersburg. Out of all the regions, the southeast region seems to have fared best given that the economies of most boroughs/census areas depend on seafood and tourism. Both sectors are more sensitive to national and international markets than the state economy.

Southwest Alaska

Unlike Southeast, there is considerable heterogeneity across Southwest Alaska. For example, Lake and Peninsula Borough had two years of very fast growth while Aleutians East suffered two consecutive years of negative growth. In Aleutians East, the losses were spread across a variety of sectors including education and health-care services, local government, and retail trade.

Southcentral Alaska

Of the four boroughs in Southcentral Alaska, the Matsu is the only one to have positive growth in both 2017 and 2018, with growth in 2018 much more robust than 2017. Anchorage, on the other hand, experienced two years of negative growth with losses in 2018 slightly larger than in 2017. Valdez performed much better in 2018 than it did in 2017, while Kenai performed worse in 2018 than it did in 2017.

Interior Alaska

We turn our attention to the Interior where Nome and Yukon were the only two areas with positive growth in both 2017 and 2018. Fairbanks had small negative growth in both years. Southeast Fairbanks census area lost more than 5% of its jobs in 2017 and experienced a strong rebound in 2018. On the other hand, Denali, grew by 3.67% in 2017 and then shed 5.87% of its jobs in 2018.

Far North Alaska

As most Alaskans know, the far north is home to considerable resources. This means that the economies of the North Slope and Northwest Arctic Boroughs are very sensitive to changes in the price of commodities. Therefore, it is unsurprising to see that the North Slope Borough had two successive years of very significant negative growth. To be clear, all these job changes include non-residents and therefore are not just reflective of the welfare of residents of these areas. Almost all the losses in both years are in natural resources and mining, with some job losses in professional and business services. It is important to note that the rate of job loss in 2018 was much less pronounced than the one in 2017. The Northwest Arctic also experienced two years of negative growth but the declines were much smaller changes relative to the North Slope. The job losses in Northwest Arctic Borough amounted to 2.27% in 2017 and 3.01% in 2018.

Monday, December 10, 2018

This most recession was driven by the severe decline in oil prices which caused a contraction of both government and private sector spending. Since the start of the recession, the state has lost upwards of 13,000 jobs. The state is comprised of 19 boroughs and 10 census areas which have different economic bases and varying levels of exposure to the oil industry and state government spending. Using employment data between June 2015 and June 2018, we show how each borough/census area has fared in each of the three years since the onset of the recession.

First year of the recession: June 2015 to June 2016

Of the 29 boroughs/census areas in Alaska, 19 experienced negative growth between June 2015 and June 2016. Below we list some of the main takeaways:

– The North Slope borough given its dependence on oil jobs unsurprisingly experienced the most significant employment decline. Its employment decreased by 14.3% between 2015 and 2016.

– Of the 10 boroughs/census areas that experienced positive growth, the most impressive growth occurred at 13.73% in Haines borough. Bristol Bay and Hoonah-Angoon also experienced double digit growth rates.

– Six boroughs experienced job declines that exceeded 5%. Those boroughs are North Slope, Sitka, Aleutians East, Lake and Peninsula, Bethel, and Yakutat.

Second year of the recession: June 2016 to June 2017

Between June 2016 and June 2017, 15 of the 29 boroughs/census areas experienced negative growth. Below we list some of the main takeaways:

– Unlike 2015-2016, the borough with the most negative growth was Yakutat Borough at -12.81%. Six boroughs/census areas experienced employment declines of 5% or larger.

– On the other side of the spectrum, Bristol Bay experienced a 38.16% increase in employment with Lake and Peninsula borough experiencing the second most significant growth at 16.70%. Five boroughs/census areas experienced growth exceeding 5%.

Third year of the recession: June 2017 to June 2018

Between June 2017 and June 2018, similar to the previous year, 15 of the 29 boroughs/census areas experienced negative growth. Below we list some of the main takeaways:

– Aleutians East experienced the most severe decline at 17.8% with Kusilvak losing 11.8% of its jobs.

– It is important to note that five of the boroughs/census areas that experienced negative growth in 2016-2017 turned around the following year. Those five boroughs are Yakutat, Valdez, Hoonah, Southeast Fairbanks, and Dillingham.